Can you use your own insurance when renting a car?

When booking a car, a common question arises: should I purchase insurance from the rental company or use my own insurance policy? Both options are possible, but they differ significantly in terms of coverage, risks and cost.

Can you use your own insurance for a rental car?

If you have a valid auto insurance policy, it often covers rental cars. However, you must be the primary driver or the insured party under the policy, otherwise the rental car company may deny coverage. The same applies to the use of similarly classed vehicles: if you insure a regular sedan, renting a luxury sports car may not be covered.

What your personal car insurance usually covers

• Third-party liability insurance covers damage to your vehicle resulting from an accident not caused by your fault, as well as property damage and bodily injury to third parties caused by your fault.

• Collision and comprehensive insurance (CASCO) covers damage after an accident. If the vehicle is irreparably damaged after an accident, the insurance will reimburse the damages up to the amount specified in the policy. CASCO insures against the risk of vehicle theft and other illegal actions, and also covers financial expenses in the event of vehicle damage due to natural disasters.

• Medical payments (PIP) covers medical expenses resulting from a car accident, regardless of who is at fault. Insurance also covers eligible expenses for care, recovery, and rehabilitation.

Read the terms of your insurance policy carefully to identify any potential gaps or limitations before considering additional rental coverage.

What it doesn’t cover (or may exclude)

Insurance policies typically don’t cover downtime during repairs, loss of value after an accident, or various administrative fees. Most policies also don’t cover rentals abroad, especially in Europe or Latin America. Check with your insurance company for details.

How to use your own insurance for a rental car

1. Call the insurance company and confirm the details before renting. Find out exactly what’s included and whether coverage is valid abroad.
2. Bring proof of insurance — an insurance card and a copy of the policy.
3. Notify the rental company that you’re waiving their insurance.
4. Carefully read the rental agreement and ensure you’re not waiving any mandatory coverage.

Do you need to buy insurance from the rental company?

Experts warn that refusing insurance at the rental desk can sometimes leave drivers dangerously vulnerable. This is because standard car insurance policies can have significant limitations regarding the types of vehicles they cover, the length of coverage and the countries in which they cover them. As a result, renters may drive without sufficient or even any insurance coverage to protect them in the event of a collision.

Sometimes car rental companies require insurance if you don’t have your own car insurance, are renting a car abroad, or are using a debit card instead of a credit card.

There are four types of car rental insurance, and understanding them will help you make an informed decision:

1. CDW/LDW (Collision/Loss Damage Waiver). This insurance policy waives liability for damage to the rental car (CDW) or theft (LDW). It also covers fees charged by rental companies for potential loss of income due to repairs to the damaged vehicle. However, this waiver may be void under certain circumstances.

2. SLI (Supplemental Liability). It provides coverage for damage you cause to other vehicles or property, as well as medical expenses for others injured in an accident where you are at fault. SLI typically provides an additional layer of protection, ensuring that the driver is covered beyond the limits of their personal auto insurance.

3. PAI (Personal Accident Insurance) is accident insurance that covers medical expenses for the renter and their passengers in the event of an accident. PAI covers expenses related to ambulance services, sick leave, and even death benefits.

4. PEC (Personal Effects Coverage) provides coverage for personal belongings in the event of theft from a rental vehicle. However, if you have homeowners or renters insurance, it may cover personal belongings even while traveling.

Using credit card rental insurance as an alternative

Many cards, such as Visa, Mastercard and Amex, offer secondary or even primary rental coverage if payment is made with that card. However, the terms and conditions vary by card type, bank and country. Most often, the policy only covers damage to the vehicle.

When it makes sense to use your own insurance

Adherence to proper insurance company procedures ensures timely and fair claims settlements. Therefore, insurance is essential in the following cases:

• You have comprehensive insurance and full coverage.
• You want to avoid duplicate insurance and save money.
• You’re renting a car in your home country.
• You’re not renting a luxury or expensive car.
• You’re at fault for the accident.
• The driver who hit you doesn’t have sufficient insurance coverage.

When you should consider buying rental company insurance

This is especially relevant if you don’t have your own auto insurance policy or if your policy isn’t valid abroad. This option is also convenient for those who want to completely eliminate personal expenses and settle potential losses more quickly. Purchasing insurance from the rental company also makes sense if you’re unsure about the reliability of your credit card rewards.

Conclusion

Yes, you can use your own insurance, but always check the details. Sometimes it’s more cost-effective to choose the insurance offered by the rental company.